U.S. Bancorp's Wealth Management & Securities Service Revenue Rises 41%

U.S. Bancorp’s Wealth Management and Securities Services division earned $48 million in net income in the first quarter of 2014, a 41% gain over the $30 million in net income during the prior year’s first quarter.
By Jake Safane(2147484770)
U.S. Bancorp’s Wealth Management and Securities Services division earned $48 million in net income in the first quarter of 2014, a 41% gain over the $30 million in net income during the prior year’s first quarter.

The division, which provides private banking, financial advisory services, investment management, retail brokerage services, insurance, trust, custody and fund servicing through five businesses: Wealth Management, Corporate Trust Services, U.S. Bancorp Asset Management, Institutional Trust & Custody and Fund Services, also had 20% higher net income than the previous quarter, which was $40 million. Total net revenue increased by $31 million (8.1%) year-over-year, driven by a $36 million (12.2%) increase in total noninterest income, reflecting the impact of account growth, improved market conditions, business expansion and higher investment products fees.

As a whole, U.S. Bancorp’s net income for the quarter declined 2.2% year over year and 4.1% from the previous quarter to $1.4 billion, primarily due to losses in the Consumer and Small Business Banking division, driven by lower mortgage origination and sales revenue.

The bank changed its capital measurement for the quarter from the Basel I approach in prior periods to the Basel III transitional standardized approach. The Common equity tier 1 ratio using this new approach was 9.7%, compared to 9.4% in the previous quarter and 9.1% during the prior year’s first quarter. Total risk based capital ratio measured 13.5% for quarter, compared to 13.2% in both Q1 2013 and Q4 2013 up to 13.5% for Q1 2014. Lastly, the bank’s leverage ratio measured 9.7% for the quarter, compared to 9.6% last quarter and 9.3% a year ago.

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